Sunday, February 1, 2009

The Internet and your wallet

There are interesting - and very worrying - developments concerning the Internet abroad, which may well come to the US soon. You should be concerned.

First, Facebook has just demonstrated a data-mining technology to make money off the personal details of its members. This isn't just social networking: it's a license to print money, as far as the owners of the site are concerned. I'm sure that Myspace and other social networking sites can't be far behind. According to the Sydney Morning Herald:

FACEBOOK is planning to exploit the vast amount of personal information it holds on its 150 million members by creating one of the world's largest market research databases.

In an attempt to finally cash in on the social networking site, once valued at US $15 billion, it will soon allow multinational companies to selectively target its members in order to research the appeal of new products. Companies will be able to pose questions to specially selected members based on such intimate details as whether they are single or married and even whether they are gay or straight.

The company, which has struggled to make money from advertising, has been demonstrating the benefits of its new instant polling tool to business leaders at the World Economic Forum in Davos.

Randi Zuckerberg, the global markets director of Facebook and sister of its founder, Mark Zuckerberg, said multinational companies had been bowled over by the ability to receive real-time feedback from the site's millions of users.

"I had tons of people saying 'this could be so incredible for our business'. It takes a very long time to do a focus group, and businesses often don't have the luxury of time. I think they liked the instant responses," she said.

At the conference Facebook asked a range of questions of its users before feeding the answers back to delegates within minutes. It targeted users in Palestine and then Israel with the same question about global peace, before debating the results.

Marketing experts have said the vast amount of personal information Facebook holds may be worth "untold millions" to market research companies.

Those embarrassing photographs you posted? The indiscreet revelation of a party where you drank too much? Your boasting of a one-night stand? All of them might now be grist for someone's marketing mill . . . and your privacy is toast.

The British government is considering a report with even more far-reaching implications. According to the Daily Mail:

Every home in the UK will have to pay an internet piracy tax as part of a new Government commitment to give every household broadband access by 2012.

Lord Carter's Digital Britain report suggested scrapping BT's obligation to provide fix line access and instead rolling out the new technology.

A so-called Universal Service Commitment would see everybody able to watch video online, including the BBC iPlayer, and put Britain at the vanguard of new internet technology.

The government also announced its plans to legislate around illegal internet file sharing, which would see online providers force to tell those breaking rules their conduct is unlawful.

Internet service providers will be required to collect information on serious repeat offenders and hand over details to music and film companies that own the content. They will then be subject to court orders.

As part of the clampdown the government will launch a rights agency to bring together figures in the industry to agree how to encourage and people to stop the practice.

The new rights agency would be funded via a levy - believed to be £20 [about US $29] - on internet service providers (ISPs) and the music and film industry.

Other conclusions could include a levy on broadband bills to compensate film and music companies for their losses from illegal downloads - which could total £1 billion [US $1.45 billion] over the next five years - and for Channel 4 to be pushed into a merger to ensure its future as a public service broadcaster.

Estimates suggest the cost of the universal broadband could run into hundreds of millions of pounds.

It is likely to be funded by service providers, such as BT, Sky and Virgin, as well as mobile phone operators, broadcasters and web content owners.

That raises the prospect that the BBC, which operates the popular iPlayer system to watch programmes online, could have some of the licence fee ring-fenced to help pay for the roll out.

Ministers see the communications sector as a growth industry for the country that can help boost the economy. The sector contributes £50 billion [US $72.7 billion] to the UK, and the Government believes it will be the backbone of the nation's economy in the years to come.

'Internet access is not just about entertainment,' one source said last night.

'It is also an essential tool for business and learning. There's a social case for this commitment.'

Communications Minister Lord Carter said this month that broadband 'is an enabling and transformatory service and therefore we have to look at how we universalise it'.

His final report, Digital Britain, will be published in June. It will outline plans to boost the internet and communications industries, as well as dealing with illegally copying and sharing music and films online.

So, whether or not you've ever downloaded music or video illegally, whether or not you've ever copied software over the Internet illegally, this scheme - or a similar one - would punish you by making you pay extra for your service. Can you spell 'creeping taxation'?

The owners of Web sites want to use your personal information (and anything else they can get from you) to make money. The State wants to make you pay even more money to build the infrastructure to let them do so, and punish you for the actions of the dishonest even if you're not among their number.

Is anyone else getting the feeling that the average Internet user is getting the shaft from both sides?


1 comment:

reflectoscope said...

We need a few heads on pikes to encourage them to think twice about such things. The British I mean. Anyone who gives a shred of information to Facebook is a sucker, and deserves everything they get.